(MENAFN- The Peninsula) The GCC petrochemicals sector is entering a promising phase in its development and has to leverage opportunities in order to overcome challenges from global competition, said speakers at the 9th Annual Forum, hosted by the Gulf Petrochemicals and Chemicals Association (GPCA) in Dubai.
"The Gulf's investments in petrochemicals have a strategic importance as they help grow economies and satisfy the growing demand for [petrochemical] products," said H E Dr Mohammed bin Saleh Al Sada, Qatar's Minister of Energy and Industry, in his plenary address. "Qapco's birth in Qatar 40 years ago marked the start of the GCC's petrochemical industry, creating a new set of opportunities."
Notable guests at the Annual Forum included Suhail Mohamed Faraj Al Mazrouei, Minister of Energy of the UAE. Aside from Dr Al Sada, top speakers at the event included Khalid Al Falih, President and CEO, Saudi Aramco; and Andrew Liveris, Chairman and CEO, Dow Chemical Company.
According to the GCC Petrochemicals & Chemicals Facts and Figures 2013, the petrochemicals capacity of the GCC reached 140.5m tonnes in 2013, an 8.7 percent increase from 2012. The sector is also profitable: Revenues from the region hit $89.4bn in the same year, a 7.3 percent growth from the previous period.
Dr Al Sada advised that three developments would influence the region's petrochemicals industry. "As oil prices reach their lowest levels in 4 years, downstream economists have to re-evaluate their strategies. The impact of US shale gas on the competitiveness of our region's industry is putting downward pressure on gas prices in the region and the emergence of coal based polyethylene in China shows that the country is looking at alternative feedstock to develop their downstream sector," he said.
Al Falih said that regional development in petrochemicals has focused on manufacturing commodities, however, developments in other markets may prove to be significant.
"North American chemicals will double in the next decade, giving them capabilities to be in markets that we thought were traditionally ours," said Al- Falih. "European markets are closing down their inefficient plants. And China is changing as well" it is growing relatively slower, however Chinese companies are looking at coal to chemical opportunities."
"As the region experiences a youth bulge, we will see an entirely new generation of men and women. Some 60 percent of the workforce at Saudi Aramco will be 35 years or under by the end of the decade"Young people today are simultaneously more skeptical and hopeful than my generation ever was," continued Al Falih.
Ultimately, the Gulf is well on its way journey towards a period of prosperity and progress. "We are in the Golden Decade for the Gulf and for the petrochemicals industry and it's a once in a generation opportunity," concluded Al Falih. The 9th Annual GPCA Forum hosted over 2000 international and regional chemical industry executives.
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